The US specialty food store industry includes about 25,000 stores with combined annual revenue of $20 billion. Major companies include Whole Foods Market, Trader Joe's, and Sprouts Farmers Market. The industry is fragmented: the 50 largest companies account for 15 percent of sales.
The industry includes gourmet food stores, natural/organic food stores, health food stores, meat or seafood markets, fruit and vegetable markets, bakeries, and candy and nut stores. Grocery stores and supermarkets, along with superstores and warehouse clubs that sell food, are covered in separate industry profiles.
COMPETITIVE LANDSCAPE
Consumer spending and tastes drive demand. The profitability of individual companies depends on effective merchandising and the ability to generate store traffic. Large companies can offer a wide selection of products and have advantages in purchasing, distribution, and marketing. Small companies can compete effectively by offering specialty products, providing superior service, or serving a local market. The industry is labor-intensive: average annual revenue per worker is about $90,000.
Competition includes traditional grocery stores, mass merchandisers, and warehouse clubs. Specialty food stores also compete with venues serving high-quality food, including restaurants.
PRODUCTS, OPERATIONS & TECHNOLOGY
Major products sold by specialty food stores include meat, fish, and poultry (40 percent of sales); produce (15 percent); and baked goods and candy (10 percent each). Other products include dry grocery products, dairy products, prepared foods, and kitchenware. Companies may place special orders for customers looking for unique items.
Specialty food stores include chains, independent ...
